Currently, a typical household’s gas and electricity bill is due to rise from £1,971 to £3,549 in October.
Prime Minister Liz Truss is understood to be planning to borrow billions to limit the expected sharp rise in energy bills for households and firms. The government is understood to be planning to pay energy firms to subsidise bills so that customers will not be expected to repay the support.
It’s thought the plan would see over £100bn added to government borrowing. However, the ultimate figure will depend on gas and energy price movements in the highly volatile international energy markets. It is unclear how long the government support will last.
Businesses are also expected to be offered some relief in the plan set to be announced on Thursday.
Unlike households, businesses are not protected by an energy price cap. Many fixed-rate deals for business expire this October, exposing thousands of firms to full costs that could rise by four or five times or more. Thousands would go bust or cut their wage bills by firing staff. Including businesses could easily push the cost of the government’s energy plan over £100bn.
So, BJ borrowed billions and spent billions subsidising businesses (many fraudulently) during the pandemic and now LT is going to borrow more billions to subsidise energy companies (some foreign) who have already made excessive profits from the energy crisis … have I understood her intent correctly ?
Can’t find it now, but I read a similar article earlier today with the figure of circa 91 billion. But heck, what’s 10 billion between friends?
Mind you, I was watching a channel 4 news thing last night with some scary figures in it. In 2008ish (just before the crash) UK’s debt was around 34% of GDP. It now stands at around 95%, which makes one wonder about the wisdom of borrowing even more.
Sorry I can’t find the link, nor post the now ephemeral data from channel 4.
Sounds about right, borrow billions that the taxpayers will have to pay back somewhere along the line, instead of introducing a tax on the profiteering energy companies.
She could impose a temporary windfall tax on energy companies for say, two years, again temporarily raise the tax threshold for individuals to 25k for two years , reduce vat on fuel for the same period , just to get people through the coming storm…
Not sure what else she can do short term she’s got to help people somehow, those of us always been on the tip of managing our bills just don’t have any way to pay these prices. Our gas and electric are to go up from under a hundred a month to over a thousand on one national minimum wage its impossible to pay that much.
@Dextrous63 l cant understand it either, the theory is they owe so much
that the lending banks cant afford to foreclose cos they will go broke too??
I thought there. bank rules anout this:roll_eyes:
@Donkeyman If only I had known, I’d have lived my life completely beyond my means and told the bank that I’d declare myself bankrupt if they pushed me too hard for their money back.
Liz is going to freeze energy prices , the energy firms can make up the shortfall from government money, ie, our money, then we will have to pay it back over years, a bit like a mortgage, so our bills will be higher to cover the debt,
For me, the main question concerns the arrangements that LT’s Tory government make with the energy companies - will there be control and oversight or will, like BJ’s COVID support, there be a free-for-all for free money …
That’s an interesting concept. Paying the hike in your personal energy bill and refusing government subsidies. In reality i dont think its possible, in the same way that paying for private health doesn’t get you a refund on NI payments.
@Dextrous63 , Either that or switching of all your rnergy supplies at the
meter this winter as an experiment yo see if we can do without ??
Who knows, it might be a warm winter??
I come from a background where we only had one electric plug and one
cold tap in the jouse, l can remember having to ignite the gas lights
that stuck out of the walls in every room !!
We mustbtough it out !!
@Donkeyman , maybe not the gaslight but my youth was spent running wires from a 2-pin socket curiously built into the light switch in the upstairs loo to run a light and my hornby train set in my bedroom, and the only form of heating was a camping gas one run from small bottles. Aye, the yoof of today…
If I lived alone, I’d power down most things and rough it. Alas, my wife and daughter wouldn’t permit this, so I’m informing them with reminders to mitigate matters as much as possible.
